Consolidation: lower payment, or higher total cost?
The idea is simple. You pay off several debts (a card at 20% RRSO, an online loan at 60%, a cash loan at 15%) with one new loan at a lower RRSO and a single monthly payment. The monthly payment drops, that part is true. The total cost can go up or down, depending on whether the new term is short or long.
Rule of thumb: if your current weighted RRSO is clearly higher than the consolidation RRSO, you win. If you double the term to „lower" the payment, you lose, even if you don't see it at the start.
Side effect. The credit lines you free up, cards especially, sit ready to be used again. If you go back to them while still paying off the consolidation, you end up with the original debt plus the consolidation. It happens more often than people think.
Alior Bank carries the widest consolidation offer up to 200 000 PLN over 120 months at RRSO from 11.8%. mBank and Santander Consumer cap at lower amounts (up to 150 000 PLN) but decide faster — 24 hours versus 2-7 days at Alior. The pick depends on amount and urgency, not on brand.
Non-bank consolidation makes sense only when a bank refuses (weak BIK, low score). Smartney, SuperGrosz and Aasa consolidate up to 30 000 PLN at RRSO 50-65%. Short version, twice as expensive as a bank, but available at BIK score 350-480 — where the bank slammed the door.
- ✓Typical amount: 30 000–250 000 PLN
- ✓Most common term: 24–120 months
- ✓Target RRSO at a bank: 12–14%
- ✓Works when your current RRSO is clearly higher